As regulations tighten, China health care sector draws global interest

HONG KONG – Biotech companies worldwide are gearing up to expand into the China market even as the CFDA toughens up its health care market through a series of reforms.

“China remains one of the most compelling markets for life sciences and pharmaceutical companies globally,” said Norbert Meyring, head of life sciences at KPMG China, a global advisory company. “This translates to opportunities for multinational pharmaceutical companies, which are currently unmatched by their local counterparts in both size and sophistication,” he said. “The pharmaceutical industry is in a dynamic environment where China is trying to position itself not only as a vast and unique market, but also as a source and destination for high-quality research and manufacturing.”

The International Pharmaceutical Federation (FIP) and the Chinese Pharmaceutical Association agreed to continue enhancing communication and promoting cooperation. Carmen Peña, president of FIP, and Sun Xianze, vice minister of the CFDA, met during the Global Conference on Pharmacy and Pharmaceutical Sciences Education, held in Nanjing, China, this month.

The conference gathered pharma industry leaders from across the world to set new goals for education and work force development of pharmacists and pharmaceutical scientists. Jointly hosted by FIP and the CFDA, it aimed to create a global vision for transformative health care and pharmaceutical sciences education. The platform enabled a dialogue among policymakers, education leaders and regulators to reach a consensus on how pharmaceutical competence and safety can be ensured.

China recently launched a drug supervision reform, which Sun introduced during the Global Conference. The reform includes a sharing system that publishes information on blacklisted drug and medical companies, among other businesses involved with food and drug safety.

The CFDA has also been cracking down on pharmaceutical companies, targeting subpar data in drug registration applications. Last month saw a rejection of 30 new drug applications, and 11 clinical trial institutions and contract research organizations suspected of providing fraudulent data have been investigated. (See BioWorld Today, Sept. 21, 2016.)

In May, the CFDA issued two announcements about quality and efficacy requirements for generics, including a review procedure and a list of generics that need to be reviewed by 2018.

In July, the CFDA issued a revised version of the Measures for the Administration of Drug Registration, which had not been updated since 2007. According to the draft, drugs that are not proved to have significantly better clinical value than biopharmaceutical products already available in China cannot be registered.

‘VERY POSITIVE FOR BOTH SIDES’

FIP introduced a roadmap for advancing education and training through a shared vision to take on full responsibility and accountability for improving global health.

“The general direction of the government is to cut down on low-quality generics, and at the same time, simplify the process for innovative drugs,” said Shi Lichen, director of the Dingchen Pharmaceutical Management Consulting Center.

“It is clear that strong action is needed. Forty [million] to 50 million new health workers, including pharmacists, will be needed globally. Around the world, ministers, their governments and all other stakeholders are expected to act,” noted Philip Schneider, co-chair of the Global Conference on Pharmacy and Pharmaceutical Sciences Education.

While the tightening of policies in China’s health care sector is causing headaches for a lot of existing players in the market that are not used to the new rigorousness, international companies looking to expand in China see this as an opportunity.

“The government is committed to increasing health care expenditure to meet the demands of an aging and increasingly affluent citizenry. It has also demonstrated a willingness to open up the sector to market forces, which will mostly benefit multinationals as they remain at the vanguard of some of the most innovative developments in the health care sector,” said Meyring.

“I see the Chinese government working very hard to improve the accessibility and quality of health care for people in China, and this provides an exciting opportunity for serious health care providers, no matter in terms of clinical care, med tech or pharmaceuticals,” Sigal Atzmon, CEO of Medix Group, told BioWorld Today. Medix is an international medical management company that links patients with specialists to enable interdisciplinary consultations and comprehensive treatments.

Medix currently has offices in Tel Aviv, London and Hong Kong but is eyeing the Mainland China market for its next expansion. The company has already worked with patients and health care professionals in Mainland China; the success of those cases and the evident demand has been highly encouraging, according to Atzmon.

“I think the government is doing right in being a bit more strict, and I think the discipline and strictness in China has done China very well,” she added.

Atzmon said she sees a trend of foreign companies entering China and collaborating with local companies, creating a win-win situation for those determined to develop a competitive edge in the new regulatory environment.

“I think for the international companies, it takes time to understand the Chinese market well. And if they collaborate, if there is a strong, growing market of local startups, then it’s very positive for both sides, because it’s an ecosystem that can learn from each other,” she said.

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